As part of Africa Week 2021, we spoke to Robert Lidstone, COO at Ecospray, about their experiences exporting their innovative bio-pesticide to Kenya and other African nations.
Thank you for joining us, Robert. Tell us about Ecospray and what it does.
Ecospray are a UK bio pesticide business. We’ve researched, developed and registered an extract of garlic as a pesticide. Garlic contains very bioactive chemicals which affect in particular soil nematodes, and have caused $100bn damage to crops, according to the Society of Nematology.
So this is a British innovation, sold as a British product, that’s solving a $100bn problem – what’s the opportunity for your business globally?
The opportunity for us is global, and that’s why we work with the Department for International Trade. Pretty much every country has this problem, but it is more acute in tropical hot climates, where farming can be more intensive, as can the pest attacks. A farmer we worked with in Kenya found that their crops were not performing, despite adding more fertiliser. We were able to diagnose the issue and use our product to start improving the crops.
Where is Ecospray in its export journey?
It started when we got the product registered in Europe. We had gone through an expensive registration regulatory approval process, but it was a big opportunity because countries outside Europe would be looking to see how our product fared on that continent.
The opportunity in countries such as Kenya, Uganda, Tanzania, and so on in Africa, our friends in the Commonwealth are there to be had. Increasingly those countries are growing crops for the developed markets in Europe and other countries. And they are paying attention to the standards that those countries employ when from a regulatory perspective by government, or indeed, whether it’s a regulatory or protocol perspective by retailers as to how they want food crops grown, and with our product, we don’t have a residue issue. And that is a huge advantage. Many products will have residues, which govern when they can be used and how they can be used. And our product, it’s a bit easier because we don’t have this residue issue.
How have you exported to Africa so far? How did you get there, and what’s it been like?
Whilst I knew about the UK, European and USA markets, I didn’t know anything about African markets, how they’re shaped, or the people within them. Where do you start?
So for us the selection of a distributor partner to work with us to trial the product, test it out, make sure it does what we say it will do in the crops that we want to target. And then to take the product on the regulatory journey, because each country will have its own regulatory systems through to registration and then into the market to get growers to start using the product is critical to success. And if you don’t get the right distributor, you will fail. So where do you go and find a distributor from? So one of the things we did was to start attending regularly an international conference and gatherings where you get the opportunity to meet people, you find people who might be interested in the technology, but do they have the capability? Are they able to deliver? And that inevitably is a judgment. But then you get into the situation? So Well, fine? They go through all of this? Are they a good partner commercially? Will they pay their bills? Are they able to do what they say they’re going to do? And these are important questions, because if you don’t get it right, you fail. And the assumption that the marketplace might be like the UK, or it might be like Italy or wherever, are usually wrong. Every single market is different. And it requires a different level of attention. So local people know those markets. And that’s actually what you need. And taking the example of Kenya, we’ve got an excellent distributor there. It’s part actually of a UK business, but they’re local. They understand the market, they have the capability for registration and development. And to aid that we have a regional manager based in Nairobi, who’s out there supporting their team, visiting growers, getting growers to convert to our product, seeing the benefits of using our product, in terms of their crops.
What differences in the business culture did you experience? Did you travel to Africa regularly, or were you able to do this virtually?
The level of technical capability our colleagues in Kenya have is impressive. It’s as good as anything we’re doing in the UK and Europe, as far as I’m concerned, and they’re adhering to the same sort of technical standards. We visit them as often as we can, but there’s clearly a cost in doing this. We spend a lot of time with emails on the phone, using Teams or Zoom, and only visit when we really need to.
The growers we work with tend to be some distance apart, clustered in specific areas which have communications capabilities not as good as we’d expect in the UK.
Having these conversations enabled us to build our relationships. It gets beyond transactional, in that you are in a partnership together, sharing the good and the bad with each to explore new ideas and work out a solution.
How developed is the agri industry on the ground in Africa?
It has to be said there are extremes in all of this. There are plenty of subsistence farmers in Kenya, and I’ve visited some of the bigger producers that are exporting and supplying to Europe, United States and Australia. The production of flowers, for example, is on an enormous scale. One farmer had 250 acres, 100 hectares of roses grown in tunnels, growing them in a programmed way. They’re growing them, cutting them and packaging them exactly to the specifications of the market they’re supplying. Kenya’s not the only country producing, by any means, but flowers very important export for them.
You talk about the quality of the technical skills and the business acumen of those you’re working with in Africa. Does this dispel myths about the capability of local staff?
I have a regional manager based in Nairobi, and he’s quite simply excellent. His qualifications match all the UK standards. He understands the technicals. He’s commercially astute, and he’s a significant asset to the business. But there are loads of people like that.
And I’ve been out walking fields with the technical guys, and they’re talking a language that I understand because it’s the same sorts of conversations that you would have with UK growers extremely impressive. So nobody should be under any doubt that yes, there are extremes of farming. But boy, oh, boy, there are some people and lots of people in Africa, certainly in the bit that I’ve seen the tiny little bit who are absolutely spot on in their approach to integrated pest management, to the use of bio pesticides to soil health, and the environmental impact of what they’re doing. And don’t forget, of course, they have to manage things like zebra, and hippopotamus and giraffes, and all the big animals and their farming within that context. And it’s not to say they don’t make mistakes, we all make mistakes. But I was very, very impressed. And it opened my eyes completely and dispelled a myth I might have had.
You’ve obviously spotted an opportunity in Africa that you’re pursuing aggressively. On a macro level, what’s your view on the growth and opportunity potential of Africa?
Some might call it an undiscovered continent. I think it has enormous potential. But it like everything, it requires hard work and investment. I think that the political uncertainties don’t help, of course they don’t. As a business, we will want to aim in the first instance for the stable economies. And I give us an example of what do through our distributor in Kenya, which is business in Zimbabwe. It is extremely difficult for them, and indirectly for us, because of the economic state of the country. That has a lot to do with politics in the country, but it’s not helped by droughts, and in some instances, floods.
I just see enormous opportunities, because all of these countries want to grow crops and export them to the developed markets, such as Europe, the UK and the USA.
If a company wants to do business in Africa, what’s the cost? Where’s the money going?
It’s a really good question, because part of our market scoping has to be: “does the product work”? Part of the exercise is this market scoping, which means trialling the product. And doing replicated trials to the right standard is expensive, because of the international standards required.
Regulatory costs suck up huge amounts of money, hundreds and hundreds of 1000s of pounds, both in terms of trials, and in terms of fees that you pay the regulator in terms of compiling all the dossiers of information, and it takes years to do it sucks up a lot of money, you can wait years to get the results. And then you can start to sell product and generate cash. And that means that there is this lag, and you’ve got to fund it. And as a small independent company, it’s actually quite difficult. If you’re a big multinational, you’ve got probably money available to do all sorts of things. We don’t. I’ve got trials waiting to go in Costa Rica, but I haven’t got the available cash at the moment.
What’s your experience dealing with regulatory bodies in Africa?
Regulatory affairs is difficult all over the world. And not wrongly either, because there have been horrendous mistakes in allowing products to be approved for use in an ecosystem, with disastrous, unintended consequences.
It is absolutely right, that there are strong, effective regulatory systems which deliver what’s needed. The time taken can be very frustrating, because you provide the data, the dossiers, and they have to be evaluated. And there are teams of people at government level who do that. And there are lots of companies not just us all applying to use different products to do different things. And so you’re in a queue. And sometimes, in some territories, there have to be public consultations.
In East Africa, they have a regulatory approval system that’s not dissimilar to Europe in its way, they will take data from Europe and look at it, but they want to see local data, and it has to be done to the correct standards. They want to make sure that from an ecotoxicology point of view, for example, that there are no inherent unacceptable risks in using this product, and it might get into water and cause damage, and so on.
West Africa is slightly different. You get an approval in one country, which automatically generates approval in another eight countries all within the Francophone region. And that can be quite useful, particularly where you’ve got countries where the opportunity is quite small, you could never possibly justify seeking approval, they get the opportunity to make use of a product in the same geographic location or situation. And they understand that the label governs what is approved and what isn’t approved, and how the product should, in fact, be used.
It sounds like African countries can be as regulated as those in the West, managed by emerging bureaucracies.
The bureaucracy is there. I wouldn’t say it’s in the experience we’ve had very different from what it takes within Europe, where it can take years to get products approved.
The UK Bribery Act is very much in our minds when we engage in new business overseas. It features in all of our agreements, and anyone we work with has to sign up to it. Whether that in turn costs us, I don’t know.
What difference does it make being British doing business in Africa? What’s your experience of how the British brand and how British business culture integrates with the African way of doing business?
we’ve been treated with nothing but courtesy and friendship, whether that’s expats or locals. In East Africa, our distributor is owned by UK business, whilst our distributor in West Africa is actually a French-based business.
I like doing business with people I like, and I think we’ve had a good exporting journey so far, but we appreciate it won’t always be like this.
Do you have any stories or top trips for travelling in Africa?
Having a distributive partner in Africa, they tended to organise travel and logistics for us. One time, we were staying in a hotel near Lake Naivasha in Kenya, and there were zebras grazing in the garden! I explored the gardens more than I should have, ignoring the signs, and found myself near the lake, close to some hippos, who are very dangerous creatures. I beat hasty retreat! Another time, we were at a partner’s house, relaxing in the garden when a family of giraffes wandered into the complex. These kind of experiences, on a business trip of all things, was magical.
Are you responsible for shipping? What can businesses expect when shipping to Africa?
This is looked after by our distributor, which keeps it as simple as possible for us because we’re not experts in freightage. Our French-owned distributor in West Africa has a distribution centre in rural France that we send our products to. Equally, for our UK-owned distributors in East Africa, we send our products to the team in the UK, who then ship them on to Africa on our behalf. The involvement from our side is minimal, and for a small business like us this reduces the complexity. I’m not sure everybody can operate that way, so perhaps we’re fortunate in that regard.
Does that mean you’re dealing in Sterling and Euros, meaning you don’t have a currency risk? For contracts, are you dealing in English law?
Everything we do is governed by English law. Ex Works keep it as simple as we possible can. There’s only six of us, so we haven’t got lots of people able to devote a lot of time to this. Though we’re making decisions about what impact Brexit will have for us, this won’t affect our interests in the rest of the world, which is where our priorities lie.
Do you have any final bits of advice or encouragement for businesses thinking about exporting to Africa?
There’s a lot of information out there that can help you make the right decisions. If there’s a country you’re interested in, find their UK embassy and have a conversation with them. You can talk to the Department for International Trade and find out who you can speak to locally on the ground. The opportunities in Africa are there, certainly from our side, so we’ve just got to encourage people to find the information that is already out there.
This conversation is available to listen on our ‘Opportunity Africa’ podcast series.
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